Modern electric power grids may combine a diverse array of power generation units fueled by coal, nuclear energy, natural gas, solar power, wind, oil, biodiesel, and/or hydro power, just to name a few. However, some of these power sources may not provide a sustained, reliable energy source for power generation. For instance, renewable power sources, such as solar power and wind, may be susceptible to environmental factors that might hinder their availability when electricity is badly needed. Hence, these power sources are often called intermittent because there might be periods of gaps in their availability. On the other hand, more stable energy sources, such as coal, oil, or natural gas, often produce undesired pollutants as a by-product of their operation. This has resulted in environmental regulations that limit these emissions and hence restrict their use.
The emergence of Smart Grid initiatives throughout the world is forcing rapid change and decentralized operation of the electric grid. A Smart Grid uses sensors, digital communications, and computer software to help collect real-time information from the grid and automate its operation. Smart Grid systems can automatically fix problems in the energy grid by isolating faulting areas, bringing extra power generation online, opening new power lines, or shedding low priority loads from the system. The widespread interest in renewable power sources brings the problem of managing distributed power generation to the forefront. The use of intermittent power sources requires new operational models that take into consideration not only future demand but also future availability of power sources and the cost of the energy they produce. A Micro Grid environment provides a scaled down Smart Grid, capable of running without transmission lines (which are used to bring electricity from far away power generators) by virtue of localized energy generators. Typically, these nearby generators run on natural gas, diesel, or renewable energy. Micro Grids environments are ideal for studying the problems posed by new management challenges arising from distributed generation, autonomous operation, energy storage, and energy sales.